Below is an edited version of the speech given by Jim Kelly, the Chair of London and Eastern Region of Unite, at a Unite ‘Reconnecting with Labour Forum’ in April. It was previously published on the United Left email list, and obviously pre-dates the present row over Falkirk and Miliband’s proposed changes to the unions’ relationship with Labour:

Living in the world of Neo-liberalism

From 1979 onwards successive governments have been dismantling the institutions of the welfare state and replacing them with those of a no-rights, deregulated market economy – what has become known as neo-liberalism.

On any indices – workers’ rights, the gulf between rich and poor, we are increasingly living with the consequences of the rise of the neo-liberal state. For example child poverty:

· 3.6 million children living in poverty in the UK .

· 27% of children, – more than one in four.

· Almost two-thirds (62 per cent) of children growing up in poverty live in a household where at least one member works.

Contrast this with the obscene profits and greed epitomised by the bankers. Rather than an aberration poverty and greed are the foundation stones of the neo-liberals’ creed. When the likes of Johnson or Osborne defend bankers’ bonuses they are then defending a principle on which the society they wish to rule is organised. Such people are out to privatise the world and they are winning.

In my opinion we are near the end game; the institutions of neo-liberalism are all but in place… Such an assertion may seem alarmist, however consider the raft of measures which were enacted on April 1st – Welfare reforms, access to legal aid and of course the Health and social care bill the privatising of the NHS, what other litmus test do we need to signal this change? We have arrived at this place due to the bankers’ crisis, which facilitated a radical acceleration in the pace of change.

Some members of Unite viewed the crash, foolishly in my opinion, as sounding the death knell of neo-liberalism. Clearly it is a broken form of economics, but the idea the elites which rule us would simply give up on it with the concentration of wealth and power it affords them over working people was mistaken. Underneath the ConDem’s smokescreen of ‘we are all in it together’ of austerity Britain we have seen the embedding of the deregulated market over the state and people.

Strikes campaigns and politics

We are then at a tipping point, and the only question is what should we do about it? Our starting point is necessarily to defend union rights and working people in any way we can – strikes, protests, campaigns, demonstrations all are the tools at our disposal. Unite members are fortunate in that our General Secretary has supported all such forms of activity, and your Region has been in the forefront of fighting back…

Unite is then fulfilling the basic principle then, to defend our terms and conditions and our basic rights such as the NHS we have to struggle against those who wish to take them away – no one will do it for us….

Through strikes demonstrations and campaigns across the county we have then the beginnings of a movement. However if this is to go beyond being a protest movement it can only culminate, outside of a general strike, in a movement to change the law.

We need legislation to get rid of the anti union laws, we need legislation to end the reign of the loan sharks, legislation to throw out the privateers. So while some legal changes directly impact on the unions we also need laws which impose wider social controls over the vagaries of the market.

Unite then is driven not just to protest, campaign and undertake strike action to defend and advance workers’ rights, we along with the rest of the labour movement need wholesale legislative change which can only come about through a political party enacting such change through Parliament. It was this need which drove unions into politics at the turn of the 20th century and what is driving us now.

Labour Party and change.

Trade unions and working people need a party that is electable and is going to act in our interests in the here and now. Within Unite there are many who are unsure about engaging in any form of political activity. It is incumbent on all of us who understand the pressing need for a political solution to explain to these members why they should actively support our union’s policy.

There are also many Unite members – often the activists, – who have given up on Labour. You just need to consider New Labour’s role in the march from the welfare state to neo-liberalism to understand this. While New Labour was never its architects, they put their shift in, working overtime to dismantle the post-war state and establish the institutions of neo-liberalism. For example PFI or the NHS internal market, New Labour was up to its armpits in shaping the institutions and political consensuses that dominate the second decade of the new century.

Of course those Unite members opposed to working with Labour would say what do you expect? However such policies did not come out of thin air – they came out of a struggle within the Party which Blair won and the left lost…There are however a number of problems with this ‘what did you expect’ approach. Firstly it is fatalistic, as if the outcome was pre-ordained, second, it has seen them leave the field; if they were attempting to organise a factory would they give up on the war after losing a battle. To put it clearly such a stance is not serious. Third it fails to look reality squarely in the face. Someone needs to tell me what other party is there? So while we must talk and convince Unite members who are unsure that we should be undertaking any form of political activity, we should also ask all those disillusioned with Labour to stop sitting on their hands and get involved and help us in reconnecting with Labour.

In spite of these differences within Unite our drive to reconnect with the Party has met with a number of initial successes most notably the election of Ed Miliband. It is also extremely welcome that the present Labour leadership have distanced themselves form some of the worst excesses of New Labour not least with Ed Miliband’s statement on the Iraq War.

However, despite the pronouncements by Labour’s leaders, the banker’s crisis and election defeat it is clear many in the party remain wedded to New Labour

There are many reasons why they cling to the wreckage; timidity, routinism, conservatism, lack of vision all play their part. However behind the bureaucratic edifice that Blair created are human actors and for them it is a simple matter of self-preservation. The positions and lifestyles of those who put the shift in to build New Labour are absolutely dependent on the continuation within the party of Blair’s neo-liberal agenda. This grouping finds its main organisational expression in the Progress faction…. This conservative faction is already dominant within the PLP. The time, effort, and money they have spent on orchestrating the nomination of ‘their’ people as PPCS, show clearly their intention to try and continue their dominance of the PLP.

I should point out that many Unite members may well be supporters of Progress and of course that is their right. The position taken at this forum is based on union policy.

We are then, as in the 1980s moving inexorably to a struggle over the direction, shape and function of the Labour Party. However this will not be a simple rerun, there are some very important differences.

Firstly the impact of the left losing that struggle in the 1980s not only shaped policy it also enabled the imposition of a hugely undemocratic structure within the party…. Second the bankers crisis has not gone away we are not as in the 1980s entering a period of prosperity. Third rather then being at the start of the neo-liberal project we are now at its conclusion… and finally unlike in the 1980s when the drive for change came from the CLPs and with some notable exceptions the unions were on the side of the status quo today the biggest union in the country is leading the demand for change.

What sort of change?

The change we demand is necessarily deep and radical; it is no less than the rolling back of neo-liberalism and the reformation of a welfare state fit for the 21st century. Such whole hearted reform needs not only to serve the interests trade unions but also working people. Indeed it is not possible to do one without the other. Let me give an example

Our General Secretary has said time and again Labour needs to come up with the goods over ending the anti union laws. However it would not be possible to have a return to union friendly laws functioning within a sea of neo-liberalism.

Yet one may legitimately ask where is such an alternative? One of the great successes of the Condem government has been not just to exclude any discussion of an economic and political alternative from public debate but to assert no such alternative exists. They are liars.

Our situation has parallels with events in the 1930s. Then a political consensus emerged around Keynesian economics which became the basis on which the post-war welfare state was built. In the 30’s it was however excluded from power, today economists, from Nobel laureates to Marxists have reworked Keynes for the 21st century, however today even more so than the 30s this alternative is excluded from public debate.

None of what we are asking for is difficult we can all envision the headlines for a renewed welfare state for example it would

· Enable unions to collectively bargain without the state being lined up against us

· Workers to be paid a decent rate of pay and treated with respect at work

· Universal health service

· Affordable housing

· Progressive taxation

· The gap between rich and poor will be closed

· A rebalanced economy

· A growth economy

· Splitting off of Casino banks setting up a national investment bank

While we could all write the script of a reworked welfare state, we are faced with the following paradox; we are living in a broken economic system which goes under the heading austerity Britain. An alternative is possible which embeds workers’ rights and empowers the poor and disposed but is the Labour Party ready to break from neo-liberalism in effect be bold enough to remake a new welfare state as they did in 1945. The conservative forces which dominate Labour make this highly unlikely without the intervention of Unite and others willing to fight for change…..

Jim Kelly

6.4.13

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Our situation has parallels with events in the 1930s. Then a political consensus emerged around Keynesian economics which became the basis on which the post-war welfare state was built. In the 30’s it was however excluded from power, today economists, from Nobel laureates to Marxists have reworked Keynes for the 21st century, however today even more so than the 30s this alternative is excluded from public debate.

Firstly Keynesian economists never altogether went away (although one would not need many fingers to count Marxian ones who are still alive and practising) but as has been well documented for a long generation the vast majority of economics graduates have been trained by neo-classical – i.e. neoliberal – university economics departments

Paul Krugman stands out not because he is the doyen of a real neo-Keynesian school but because he is almost unique at that level of his profession.

Secondly in the 1930s Keynesianism was never excluded from public debate (apart from in countries where there was no public debate…) , Mosley as leader of the Labour Left as well as as a renegade, Labour itself after MacDonald’s betrayal, Lloyd George as leader of the Liberal Party, the New Dealers in Roosevelt’s administration, the Popular Fronts in France and Spain all deployed Keynesian arguments to varying degrees.

With the very partial exception of Roosevelt (who was original elected on a programme which attacked Hoover’s profligate spending on all those dams and who oscillated between expansion and austerity), none of these arguments were however won because in a real economic depression the electorate is not radicalised but cowed and divided.

And that is our problem now and why whatever their true inclinations Miliband and Balls have to genuflect to the Gods of Austerity.